Are Oncology Drug Prices in the United States too High? A Targeted Review of the Literature

Abstract

and Spain are compiled from IMS Health data from 2001 to 2013 and linked to a variety of country-level indicators that, based on prior literature, could explain observed differences in (1) overall oncology spending as a percentage of the country's total prescription medication budget, (2) share of generic medication utilization when a generic is available, and (3) the utilization share of different types of oncology therapies such as hormonal, cytotoxic, and targeted biologic treatments. Country-level factors used to explain this variation include cancer prevalence, per capita income, health insurance system classification, and access to physicians. A variety of econometric panel data methods are used to evaluate the associations between selected country-level indicators and the outcomes listed above. Results: Preliminary results suggest a moderate association between health system classification, physician access, and oncology medication spend. Specifically, we find that countries with social insurance systems with greater access to physicians are more likely to use targeted biologic medications in place of cytotoxics. The tendency to use biologics also explained most of the variation observed in generic oncology medication utilization. ConClusions: Differences in country-level oncology medication spending are primarily driven by a higher demand for targeted biologic medications. This demand can be partially explained by increased physician access and health insurance system type.